The Canadian Securities Administration announced an initiative on June 20, 2024, that is intended to support capital-raising by early-stage businesses by allowing exempt market dealers (EMDs) to participate as selling group members in prospectus offerings. The announcement states:
EMDs play an important role in assisting start-ups and small to medium-sized businesses raise capital by distributing those businesses’ securities under prospectus requirement exemptions. However, as the businesses grow and seek financing through prospectus offerings, EMDs are unable to participate in those prospectus offerings due to restrictions on their permitted activities.
The securities regulators of Ontario, Quebec, British Columbia, Saskatchewan, Alberta and Nova Scotia are working together to bring this initiative into force in their respective provinces.
Investment dealers will continue to remain involved in these offerings, including by acting as underwriter and signing the underwriter certificate to the prospectus.